Employment System in Middle East - Essay Example

Running Head: Employment System in Middle East POVERTY AND SOCIAL WELFARE ON THE EMPLOYMENT SYSTEM IN THE MIDDLE-EAST of Institute] [Date] Abstract Middle- east is an important part of the global world and it holds great importance from the technological aspect and also from the human resource aspect. At today's world where the whole world is facing recession and a complete backlash is faced where employers are being fired out. Among the same world, where turmoil is seen Middle-East countries have some hope of employment. This objective of this paper is to highlight how poverty and social welfare is linked to employment in the middle-east. This paper is divided into five sections, in the first section introduction is given, then in the second section poverty, social welfare and employment in the middle-east are discussed. In the third section, a linkage is created between the poverty and employment. In the forth section, linkage of social welfare and employment is created and finally in the last section conclusion is given. This paper is adopting a secondary research methodology, i.e. all the data collected have been from published articles, magazines, books, journals and newspaper articles. Key Words: Poverty, Employment, Social welfare, Middle-East. Introduction Middle Eastern countries comprise of the following countries, i.e. Iran, Iraq, Kuwait, Bahrain, Oman Qatar, Saudi Arabia, UAE, Yemen, Israel, Jordon, Lebanon, Syria, Turkey, Cyprus, Egypt, Gaza Strip and West Bank. Not all of these countries are well established but there is a good demand of employment in these countries, especially Africa and Dubai. The Growth level in this system is emerging with the passage of time but unemployment rate has not declined to a greater degree. There is still a large amount of population unemployed. This paper focuses on the linkage between the poverty and employment & social welfare and employment. The section three and four will emphasize the two concepts in detail. Poverty, Employment & Social Welfare Employment In 2004-2006 when all the rest of the world was going through a recession in the employment industry, some middle-eastern countries passed through the job creation phase. There was employment opportunity in these areas because the private sector showed major development. There were a lot of foreign and domestic investments made by the local and foreign companies that boosted, enhanced and created job opportunities for the unemployment class. These job opportunities catered well as not only were the demand of the young, energetic, talented and capable people met but also these unemployed workers now were provided with the platform where they could put their best efforts to achieve their potential goals. But it sad to state that apart from all the opportunities, the unemployment level in the Middle East was still very high and a major sector of the workforce still remains unemployed. Middle East is also faced with another disappointing workforce practice, i.e. discrimination has been observed in the middle-eastern countries, as women who are a foremost source still experience through a high level of unemployment rate. It has also been stated that middle-eastern women are more talented and educated than as compared to men but regardless of all the efforts made they are still lacking far behind. This discrimination is widely observed in Egypt. The Middle East is experiencing high economic growth rate and it has been stated that from 2004 to 2006, its real GDP per capita had a 4.0 percent annual increase. But despite all these growths, Middle East also suffers from 25 percent youth employment (which is the recorded as the highest among all regions). Among the employed the highest level are new job seekers of age range of 15- 24 years who account for 50 percent of the unemployment in the region. On the other hand young people with secondary and post secondary education are also faced with employment issues such as mismatching skills and long queues for government sector jobs. Poverty Apart from unemployment, poverty is another major concern in the Middle East countries as poverty is in their crust now and hence it is a major concern for the policy makers. Poverty not only weakens the position of the country but also terminates and affects the growth of country. Poverty has always been the main area of fear for the Middle East citizens because there had been situation where the basic needs are even not met by most individuals. Among the middle-eastern countries, Egypt, Jordon, West Bank and Gaza and Yemen are those specific countries were poverty is creating turmoil in the growth process of the country. Among the Middle East countries, Yemen is the poorest countries of the world where 42 percent of the population is living in poverty. Poverty is generally prevailed in the rural areas and the major reasons and factors behind poverty are; the lack of education, geographical location, few source of income (generally, the feeding source is only one) and a large number of family members are dependent on that specific person, and there are few number of worker remittances from abroad. There is a large population of children and women that comprise of those defenseless and susceptible population members who live in the rural areas where the basic health and education services are not provided to them. So it can be stated that the poor class is not paid much attention as all the social services and social programs are provided to the urban citizens (which are quite better-off than as compared to the rural citizens). This discrimination widens the rural-urban gap and hence it further exaggerates the poverty level and worsens the situation. (Anonymous, 2002) It would be wrong to say that there has been no improvement in eliminating poverty because efforts are being made which have lead to gradual improvement and certain economic growth. In 1990's agriculture and oil sector helped the country achieving economic growth and thereby reduced poverty. It has also been stated that like all other middle-east countries the government of Yemen prepared a Poverty Reduction Strategy (PRSP) in 2002 which was composed of five year plan and was based on the Household Budget Survey (HBS) of 1998 and National Poverty Phenomenon Survey (NPPS) on 1999. This report highlighted the dimensions of poverty, analyzed the past and the current policies on poverty and then further provided recommendations to eliminate poverty and achieve high living standards. But reducing poverty is not a just an easy task as it not only requires of making plans but a deep effort is required in implementation of these strategies. So due to this government needs to pay proper attention to eliminate and eradicate poverty and for this the government should change the government structure and pursue structural and institutional reforms, make efforts to narrow the urban-rural gap, improve the effectiveness of the public investment by focusing on the needy citizens, i.e. the social sector investment should be more focused on the lower (rural area) class and also increase expenditure in providing the basic health, education and safety needs to the citizens (Anonymous, 2002). Social Welfare Social welfare refers to those set of activities that are provided by the government to the citizens of the country in such a way that it would complement them, help them or act as a welfare service to them. The concept of social welfare emerged in mid 1920's, when in 1926 the government of Palestine made efforts in providing compensation for the work injuries. Later after ten years other Middle East countries Egypt, Iran and Iraq and then later Syria (1941), Cyprus (1942) and Lebanon (1943) followed the trend and provided compensation to their citizens. These welfare services were not just limited to the work injuries but Middle East countries also provided initiatives in maternity, old age benefits like provident fund and insurance fund that would act as saviors for the old age or retired people and become a source of help at their old age. Other social welfare services like sickness insurance, children allowance, death benefits were also introduced. It has been stated that by the end of the 1950's all the nine countries of the Middle-East, i.e. Turkey, Egypt, Israel Iran, Cyprus and Iraq had introduced some form of social welfare for the citizens covering long-term possibilities like injury loss at work and short-term possibilities like sickness, maternity and unemployment issues (Dixon, 1987). Further in 1960's this is also termed as the consolidation period where different modifications were made as different contingencies which were previously not included were now made part of the social schemes. Provident fund was converted to social insurance scheme in1964, in 1969 Saudi Arabia created the social insurance scheme which included long-term benefits, sick leaves and paid sick leaves were introduced. Jordon for the first time introduced paid maternity leaves and workmen's compensation scheme. Later Kuwait and Bahrain in 1970's extended their social welfare scheme by introducing old age benefits, invalidate and death benefits, work injury benefits and then Israel included unemployment in 1970 (Dixon, 1987). Poverty and Employment There is a strong link between Poverty and employment and their linkage would be explained by the 'employment-poverty nexus'. According to this nexus, a proper set of employment policies should be designed in such a way that they would tackle the poverty level in a country. But in this nexus out growth also helps in reducing the poverty level. As it is stated that if growth could be achieved it would lead the government to increase revenue (through Tax) which would lead to an increase in the expenditure of goods and services which ultimately leads to poverty reduction (Messkoub, 2008). On the other hand, to increase output more people are hired, i.e. unemployment would eliminate by increasing the output of the goods and services because then more goods or products will be demanded, which would lead to the demand for labor ultimately resulting in employment. According to the employment-poverty nexus, issues such as elasticity and integribility have to be addressed so that the benefits of the growth can be reached to the poorer section of the population. But proper strategic issues should be kept in mind to reduce poverty among the poor workforce by increasing the labor productivity (by hiring poorer workforce). But there is a big distinction among its objectives, i.e. long-run and short-run objectives. In the short-run it s stated that labor intensive and low skill public projects would satisfy the elasticity and the integribility condition. Because when temporary activities like some public work would be undergone that would eradicate social and economic distress. As when temporary employment would be provided to the poor labor force that would increase their income level hence improving the local infrastructure which would lead to the formation and development of that specific region. Due to this long term investment will enter the market creating jobs and employment for the poor section therefore eradicating complete poverty from the society (Messkoub, 2008). Social Welfare and Employment Social welfare and employment are directly related to each other as in Middle Eastern countries a set of those social welfare benefits were provided to the citizens which provided them with different employment opportunities. These employment opportunities were set on all set of people from the aged, disabled, family people, unemployed, students, women, sick and others. They were all provided social insurance as well as social assistance to these set of groups. But all the twelve countries social welfare programs differed from each other but there main crust was the same, i.e. to increase the employment opportunities for the population of different segments. Social welfare basically includes social security, social assistance and social allowance. These twelve Middle Eastern countries basically provide social welfare services to the aged, inform of earning- related benefits like pension, early retirement, income test as post-retirement income, minimum pension rate payable, maximum pension rate, cost of living adjustments, wage adjustments and also additional retirement benefits to both men and women (Dixon, 1987). Social assistance is also provided to the needy aged or to those who are not eligible for social insurance benefit. Handicapped and disabled were helped through work-injury benefits, insurance strategy, and workman's compensation scheme and others. Women were helped through family allowance programs where if the employees had a lump sum of one or more children received a lump-sum payment for the first two children and maternity half pay-leaves were provided to the employees. For example, Israel catered for the social allowance, where a flat-rate allowance was provided for living adjustments (Dixon, 1987). The sickness benefits on the other hand were provided by the six Middle Eastern countries. These benefit rates were to be determined by the duration of the sickness, apart from that sick employees were provided supplements and at times cash compensation and in some countries a maximum and minimum payment periods are also set. The employees are provided with paid sick leaves and at times a waiting period is also provided to the employers. In Saudi Arabia full 30 days pay is given with a further 60 days part pay (Dixon, 1987). Unemployed citizens were provided social welfare service by five countries, i.e. Cyprus, Egypt, Israel, Iran and Jordon. Some of the employment benefits are contribution period of six months, flat-rate payments, additional cash supplements, maximum benefit rate cost of living and wage adjustments (Dixon, 1987). Conclusion Even though there is a lot of growth seen in the Middle-Eastern countries in the past few decades but still unemployment is present. But it would not be wrong to say that unemployment is not seen in all the Middle-Eastern countries as some countries are enriched with high level of production capabilities. But there still is a major portion that remains unemployed and the main reasons of unemployment are poverty and social welfare. In this paper a complete link is created between these three and it is hence concluded that if the poor workforce is employed in any work then poverty can be eliminated from the society. Moreover, it is also stated that social welfare has a strong connection with the employment system of the Middle-eastern countries. The reason is that one of the biggest ways to provide social welfare services to the society is through providing employment or enhancing the employment sector or employment system. Middle-Eastern countries have always provided social services of different kind to the citizens, its intensity and composition may vary with different situations and different countries but they have properly understood that social welfare services are an important tool. References Mehmood Messkoub, 2008, Economic Growth, Employment and Poverty in the Middle East and North Africa. Pg. 17-19, Institute of Social Studies. Accessed on April 12, 2009 from http://biblio.iss.nl/opac/uploads/wp/wp460.pdf John E. Dixon, 1987, Social Welfare in the Middle East Pg 163-79. Accessed on April 12, 2009 from http://books.google.com/booksid=B9U9AAAAIAAJ&dq=social+welfare+in+middle+east&printsec=frontcover&source=bl&ots=pctl24cppe&sig=QHIuuAKBSdHBeFEos87oN7Xx1SI&hl=en&ei=vrDgSeykJoi4tgOyi8C9CQ&sa=X&oi=book_result&ct=result&resnum=2#PPA162,M1 Anonymous 2002, Republic of Yemen Poverty Update, Volume 1. Accessed on April 12, 2009 from http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/2003/03/13/000094946_03011404014323/Rendered/PDF/multi0page.pdf Read More